The Supreme Court's remarks last week focused on holding celebrities and social media influencers accountable for misleading or deceptive claims in advertising campaigns they endorse. While hearing a complaint against misleading advertisements by Patanjali Ayurveda, which was endorsed by yoga guru Baba Ramdev himself, the Supreme Court ruled that the misleading claims made in the campaign He said both parties are equally responsible.
The SC's remarks strengthened the Advertising Standards Council of India (ASCI) guidelines on celebrity endorsements and penalties notified by the Central Consumer Protection Authority (CCPA) in 2022.
The CCPA can impose the following penalties: INRManufacturers, advertisers and endorsers can be fined up to 1 million yen for misleading statements in their advertisements. INR5 million for subsequent violations. Brand ambassadors can also be banned from endorsing products for up to three years if they violate CCPA guidelines.
These rules are very important in India's fast-growing brand endorsement market. Last year's Celebrity Brand Valuation Report by risk advisory firm Kroll estimated the overall brand value of the top 25 celebrities in 2022 to be $1.6 billion, an increase of 29.1% from 2021. Celebrities like Ranveer Singh, Virat Kohli, Alia Bhatt, Akshay Kumar, etc. MS Dhoni are ranked based on their value derived from their brand endorsement portfolio and relative social media presence .
Additionally, for the first 37 matches of the Indian Premier League, 61% of ads were endorsed by celebrities, compared to 39% of ads without celebrities. “The ads have become safe and formulaic. We're not trying to offend or upset anyone. There's a certain comfort in the star being a well-known face, well-liked before the commercial even starts.” and Priya Padhiwala and Steve Mathias explained that advertisers are overly reliant on celebrities. Padiwala and Mathias are chief creative officers and co-founders of the newly launched agency Steve Priya. “If this star is used in a promiscuous manner, all of her followers could become users of the brand,” they said.
Subhash Kamath, special advisor and former chairman of ASCI, said the SC's recent warning will make brands and stars cautious. In the past, brand ambassadors didn't care what they had to say as long as they were getting paid. Kamath said more responsible celebrities are now asking advertisers questions. “They're asking questions about the merits of the product, not just the script,” Padiwala and Mathias said, “and they know that their fans, friends and followers are a currency that can't be devalued.” added.
Consumers are becoming more aware, researching products and reading labels. “They don't want anyone to fool them. The SC's observations are consistent with current sentiments,” they added.
Manisha Kapur, CEO and general secretary of ASCI, said celebrities need to complete due diligence on brand claims given the influence celebrities have on consumers. Ta. While the ultimate responsibility lies with brands, celebrities cannot escape that responsibility either. She said the law is very clear that endorsers' responsibilities are separate from advertisers.
Kapur said ASCI is committed to continuous improvement of the advertising code. In August 2023, the definition of celebrity was updated to include influencers with more than 500,000 followers or annual income. INR400,000.
“Brands and celebrities have a shared responsibility in endorsements. Everyone in the ecosystem must be aware of their own responsibilities and responsibilities under the law. Celebrities are experts on all issues. “It may not be your home, but you need to seek professional opinion for due diligence,” she said.
Movie and sports stars earn large sums of money in endorsements and have strong influence over consumers. “It is their responsibility to ensure that the advertising of the brands they support is honest, legal and decent,” said Sumit Sinha, managing partner at Alchemist Brand Consulting. said. They need to insist on legally binding contracts to ensure that brands cannot release advertisements featuring them without their explicit written consent.
Purdiwala and Mathias said they are fortunate to work with responsible companies that invest in research and technology to keep their products safe. “We need to invest in products, not just communication. The SC ruling will force companies to invest in and develop better products that make a real difference to consumers and their lives. ”
